Linkage Analysis Between Defense Expenditure And Economic Increasment In China

In recent years, there is more and more complex phase of international security. The line between safety and danger becomes more and more slurred. In base of national safety, many academicians begin to research on harmonious development between national defense and national economy. This dissertation studies the correlation between investment of national defense and increase of national economy in China from 1989 to 2005, which utilizes the qualitative analysis and quantitative analysis. In qualitative analysis, this dissertation analyses the relational effect between investment of national defense and national economy, according to economics fundamentals and some facts. In quantitative analysis, this dissertation applies Ram model to the relational effect between investment of national defense and national economy, which is based in the result of some simple relational analysis. At last, this dissertation applies Granger Test of Causality to prove the correlation between investment of national defense and national economy. Then it educes the unilateralism correlation between them. There are some windages from forecast. And it needs some time to validate this method. At last, according to the result, this dissertation puts forward some suggest to accelerate harmonious development between investment of national defense and national economy.